Maersk Supply Service has been in the oil and gas industry for 50 years, but with the OSV market mired in a slump these last five years, it has had to rethink, reshape and reinvigorate its business model, led by new chairwoman Henriette Thygesen
When the time came to appoint a new chairwoman of the board in 2019, Danish OSV owner Maersk Supply Service (MSS) needed a leader with a diverse set of management skills, experience and insight into the oil and gas industry. It didn’t have to look very far, finding the perfect candidate within the Maersk family of companies.
Henriette Thygesen was appointed chairwoman of the board of MSS on 1 June 2019. A shipping industry veteran with more than 25 years’ experience, Ms Thygesen joined AP-Moller-Maersk as a management trainee in 1994.
As a young woman, she was driven by the opportunity to build an international career and at AP Moller-Maersk she was able to do just that, holding management roles of increasing responsibility in Europe, Asia and North America for Maersk Tankers, Maersk Oil and Maersk Logistics (later named Damco).
She was named chief executive of Svitzer, Maersk’s towage operator, in September 2016, coming from her role as chief executive of Damco Americas.
When she was appointed chairwoman of MSS, she retained her position as chief executive of Svitzer and is also chairwoman of the board of Maersk’s freight forwarder company Damco.
As chairwoman, Ms Thygesen is steering the transformation of MSS from an OSV owner to an integrated solutions provider, expanding the company’s portfolio beyond traditional oil and gas.
“Three years ago, MSS launched a new strategy that focused on three pillars: optimising our core business; introducing integrated solutions; and diversifying into new sectors,” she says.
“We have seen strong progress on all three elements and will continue to execute our plan to position MSS for the future.”
While oil and gas will remain the core industry for MSS, Ms Thygesen adds: “Do you want to be first mover, a fast follower or simply be run over by other players that were better at anticipating customer needs, transforming themselves accordingly? This I believe is a challenge and a question we all need to ask ourselves across the industry.”
She notes that while MSS is beginning to see clear signs of recovery with more tender activity, the OSV industry is still under pressure with many vessels in layup and low utilisation and rates. “The recovery is taking longer than expected; therefore, we find it prudent to continue our diversification efforts,” she says.
Part of the strategy, explains Ms Thygesen, is to take on larger project scopes for its customers, what it calls “integrated solutions.” Good examples of this, she says, are three large moorings projects won by MSS in which the company delivered project management and engineering on top of its in-house fleet of more than 40 vessels, showing “extensive experience as a marine service provider [and] demonstrating that we are now an established partner in this space,” says Ms Thygesen.
Diversification into new markets
The prolonged downturn in the offshore oil and gas market also provided an impetus for MSS to pursue new markets and new types of partnerships, based on its maritime knowledge, unique vessels and people, says Ms Thygesen: “Our target is to have one-third of our business generated by non-traditional oil and gas. Due to the versatile nature of our fleet and our experienced crew, we believe we have a good foundation to diversify and pursue new growth markets.”
Over the last three years, MSS has established a dedicated innovation team to focus on building a strong pipeline of projects with the clear objective of maximising the use of its assets and marine capabilities. The Danish OSV owner formalised this process in order to provide a clear structure to grow an idea from concept to market launch.
“Diversification is about investing in our future – we are building a robust pipeline of innovation opportunities,” states Ms Thygesen.
MSS’s diversification efforts are starting to pay off. “We have taken firm steps into new markets and matured actual partnerships and opportunities,” says Ms Thygesen. She cites the company’s penetration into the offshore wind sector with an innovative project for installation and clear ambitions for floating wind, its partnership on deepsea metals, the formation of a decommissioning joint venture with Maersk Drilling and support of the non-governmental organisation The Ocean Cleanup in removing plastic from the oceans. “All in all, strong progress, that will position MSS for the future,” she states.
For floating offshore wind projects, MSS has an integrated solution that offers planning and engineering, site preparation and pre-lay, towing, installation and onshore and offshore support. It also offers an in-house vessel fleet of 30 anchor-handling tug supply (AHTS) vessels, nine construction support vessels (CSVs) and three AHTS vessels fitted with offshore cranes.
MSS began working with DeepGreen Metals in 2017 on sustainable ways to harvest polymetallic nodules – small rocks containing valuable metals – from the ocean floor. Metals such as copper, cobalt, manganese and nickel are contained in the nodules, providing materials for electronics and batteries. Underpinning the project, studies were conducted offshore in the Clarion Clipperton Zone in the Pacific Ocean at depths of 4,500 m.
In April 2018, MSS forged a 50-50 joint venture with Maersk Drilling to offer bundled solutions for up to 80% of the process required in decommissioning an offshore oilfield. The bundled solutions, in addition to project management, cover work scopes such as plug and abandonment of wells, towage of floating units and removal of subsea infrastructure. In the longer term, the JV plans to provide the full end-to-end process of decommissioning.
Elsewhere, MSS worked with The Ocean Cleanup, towing a specialised 600-m-long floating array that collected plastic debris in the Great Pacific Garbage Patch for recycling.
Investments in people and technology
MSS is underpinning its diversification strategy with key investments in assets, IT and people. Ms Thygesen says the addition of the dedicated position of energy efficiency manager and an innovation team have been critical in driving forward new ways to utilise its OSV fleet and enhance the company’s capabilities.
In February 2019, MSS took delivery of Maersk Maker, the last of six M-class Starfish series AHTS vessels from Norway’s Kleven Shipyard, completing its 10-vessel newbuilding programme. MMS also took delivery of four I-class Stingray series subsea support vessels from China’s COSCO Dalian Shipyard under the programme.
“It is important to recognise that the OSV industry has been under pressure (for a number of) years,” says Ms Thygesen, “which means all investments have strictly been in line with our overall plan and strategy. And like all other companies, we have been looking at reducing costs and ways of optimising the way of we work.”
From 2016 to 2018, MMS also shed some older tonnage, selling off 23 platform supply vessels (PSVs) and AHTS vessels in reaction to the oversupply in the global OSV market. As a result of the newbuild programme and divestiture of older tonnage, the MSS fleet now has an average age of less than 10 years old.
Cutting fuel consumption, increasing efficiency
In line with sustainability goals, regulatory compliance and increasing demands from charterers, over the last two years MSS has had focused on driving energy efficiency, increasing productivity, reducing fuel consumption and minimising its environmental footprint in all parts of its operations. “Our goal for 2019 was set to achieve a 5% reduction in fuel consumption across the MSS fleet in one year, compared to our 2018 performance,” she says. Preliminary results indicate that MSS could have been more optimistic in its goals. “By Q3 2019, we reduced our fuel consumption by 9% across our fleet – corresponding to 1,810 tonnes of fuel saved and 5,800 tonnes of CO2 emissions.” While technology has a role to play, Ms Thygesen says the results were “primarily achieved by creating more awareness among our seafarers.”
MSS is also making technical upgrades on some of its vessels to support the crew in their energy efficiency efforts. “Digitalisation plays an important role in all industries – not the least in shipping,” she says. “We have installed an Energy Advisory System on some vessels to help the offshore crew manage its performance.”
Under a contract with Wärtsilä subsidiary Eniram, MSS has installed the software platform Energy Advisory System on two of its vessels to optimise operations and reduce fuel consumption. The initial proof-of-concept trials are being carried out on two of MSS’s newest vessels, M-class AHTS vessel Maersk Mobiliser and I-class subsea support vessel Maersk Installer.
After initial testing during the proof-of-concept stage, MSS plans to roll out the Energy Advisory System to additional vessels, with the long-term goal of installation across the entire fleet of 44 vessels.
The Energy Advisory System collects data from flowmeters, sensors and other systems on board to identify in real-time possible actions the operator can take to reduce fuel consumption.
Drawing lessons from other sectors
Ms Thygesen is also drawing on her experiences at the helm of towage company Svitzer and applying that knowledge to MSS. She says: “At Svitzer, we are always asking ourselves if we can improve our services by getting more digital. How can we use digital and technical innovation to become safer and more efficient? Can we leverage data to expand our role from being a provider of towage to becoming a marine solutions partner in a port or a terminal? As examples of this, we are currently looking at leveraging digitalisation to simplify work processes and use the operational data we generate and have access to in a port or terminal [to achieve] faster turnaround times for our customers.”
The goal of digitalisation is to implement new tools to support seafarers, allowing them more time to focus on their operational duties with a stringent focus on safety, she says.
“I see some similarities between Svitzer and MSS. Both companies are on a journey taking on larger scope for the customer. Both companies are part of the Maersk family and at the same time standalone companies and businesses with their own strategies, customers and markets,” she says.
Ms Thygesen adds: “Across the Maersk brands we share the same fundamental focus on safety and operational efficiency as prerequisites for winning in our respective markets. Also, we all share the Maersk core values that actually drive the way we do business and lead people and organisations, regardless of Maersk brand.”
Concludes Ms Thygesen: “In my view, the biggest challenge for any player at sea is to strike the right balance between innovating and rethinking their businesses and operating models, while at the same time keeping costs down and providing safe and efficient solutions to their customers.”
Job titles: Chairwoman of the board, Maersk Supply Service
Chairwoman of the board of Damco Forwarding
Education: MBA, International Management, ECCIP Paris and EU Munich
MS, Copenhagen Business School
PhD, Applied Mathematics, Copenhagen Business School
Executive MBA, E-MBA Global, Columbia University and London Business School
Favourite book: Wild Swans and historical novels in general
Favourite movie: Life is beautiful by Roberto Benigni
Favourite app: Suduko app, podcasts and nemlig.com (I shop all groceries online)